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Wednesday, October 9, 2013

Tony Newbill Emails 9/10 to 9/25/13

This set of emails begins with more of Newbill following the possible reasons that Obama is interested in what happens in Syria. It does have to do with American National Interests, natural gas, oil and Russia. The other emails deal with the dangers facing the American economy and the Federal Reserve’s economic management.

The Cold War is now so over that it might as well be grouped with the ancient ice ages, but there is one echo rolling across Europe from East to West: the Russian attempt to dominate the natural gas market on the European continent. As the energy sector accounts for 25 percent of Russia's economy, any large changes in energy markets present major challenges for Vladimir Putin. Those old enough to recall the Soviet gas pipeline controversy of the early 1980s a high-profile fight of the Reagan administration to deprive Moscow of hard currency are right to have a feeling of déjà vu, as Putin's motives transcend honest commerce.

Despite huge gas reserves waiting to be tapped, most of Europe lags the United States in the shale gas boom for several reasons: a lack of mineral rights on private land, bureaucratic obstacles, the usual intransigent opposition from Europe's potent green lobby, and, perhaps most important, the lack of adequate pipelines to connect new gas fields to the market. Hence, natural gas prices in Europe are several times higher than U.S. prices. Since natural gas and oil are Russia's principal export commodities, the prospect of newly abundant oil and cheaper gas outside of Russia is a grave threat to Russia's economic and political might in the region. Russia can't do much about global oil trends, but Putin and the state-controlled Gazprom are doing everything they can to throttle new gas development in Eastern Europe, rerunning the same kind of behind-the-scenes propaganda against shale gas that the KGB ran against new NATO missiles back in the Cold War. Propagandists in Russia are promoting every translation possible for the message fracking=bad. The second prong of Putin's strategy is to control pipeline development as far as possible. But things are not going well for him.

Gazprom is the linchpin of Putin's political and economic strength. The state-controlled natural gas conglomerate is a huge source of revenues for the Russian budget, but also a slush fund for Putin's clan the corrupt network of power-political and economic relationships that rules Russia today. Immediately after coming to power in 2000, Putin moved to put the company under his direct control. In short order, he made his protégé and current prime minister, Dmitry Medvedev, chairman of Gazprom's board and appointed another protégé, Alexey Miller, as CEO. According to a book by two prominent former Russian politicians, 11 of the 18 executive positions in Gazprom were quickly filled with Putin cronies. He then moved to make the company a national champion, giving it an exclusive license for the export of the country's gigantic gas wealth. It is widely believed that Putin makes all of the key Gazprom decisions himself.

Putin's energy cronyism is vertically integrated, as he ensures that infrastructure projects such as pipeline construction go to his friends' firms at lucrative prices. Gazprom pipelines typically cost two to three times more than those built by Western companies, despite the much lower wages paid to Russian labor. While the German portion of the Nord Stream pipeline, for instance, cost $2.8 million per kilometer, the Russian portion built by one of Putin's handpicked companies cost $6.5 million/km. This is one reason Putin likes pipelines, even if he can't guarantee they will be fully utilized.

Sitting on 18 percent of the world's current proven gas reserves (a percentage that shrinks with each new discovery elsewhere), Gazprom became one of the largest companies in the world. At the 2008 peak of the bubble in oil prices, to which Russian gas prices were indexed, Gazprom's hubris overflowed. With a market valuation of $365 billion at the time, Alexey Miller confidently predicted that his company would become the largest in the world, with a market cap of up to $1 trillion by 2015, and that it would dominate the huge Chinese market as well as 10 percent of the American market with shipments of liquefied natural gas (LNG). Gazprom's optimists thought it could command 30 percent of the world market.

…

Two other threats to Gazprom's fortunes must also be mentioned. For years Gazprom and Kremlin propaganda have done their level best to scare the Europeans away from shale gas exploration. Alternatively dismissing it as a Hollywood invention or conjuring up an ecological apocalypse, the Kremlin seemingly believed that it can wish this threat away, despite evidence of the massive impact of the shale gas revolution in America. Early on, things seemed to go their way, with France and Bulgaria imposing a moratorium on shale gas exploration. No longer. With Great Britain now allowing fracking and Germany's government submitting a draft law to do the same, the genie is out of the bottle. It's only a matter of time before European countries begin exploiting their domestic shale gas fields, posing yet another challenge to the Russian monopolist.

Vladimir Putin may have dreamed of becoming the J.R. Ewing of Europe, but his recent moves are more in the mold of the hapless Cliff Barnes. His signature initiative at the moment is the proposed South Stream pipeline, which would run under the Black Sea and through Bulgaria to points west. Putin was hoping Gazprom could retain monopoly control of the pipeline, but because it runs through European Union territory, it is subject to the EU's market regulations (known as the Third Energy Package ), which require that all pipelines be available for use by competing suppliers and overseen by an independent EU regulator. These conditions are unacceptable to Putin and make it unlikely that South Stream will be built.

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That strategy envisaged South Stream as achieving two key political objectives. In bypassing Ukraine, heretofore the key transit country for Russian gas to Europe, it would provide the Kremlin with a powerful weapon for continued economic and political blackmail of Kiev. And, just as important, it would preempt the realization of the competing Nabucco pipeline project, designed to bring non-Russian gas from the Middle East and Central Asia into Europe. The Nabucco pipeline will run to Europe either by way of Greece and Albania into southern Italy, or through Bulgaria, Romania, and Hungary to a hub at Baumgarten, Austria. A decision on the final route is expected in June. The defeat of South Stream holds dire implications for Russia's standing as the indispensable gas supplier to Europe and for the political fortunes of Putin. [Bold Emphasis Blog Editor – It is my impression Tony Newbill is drawing attention to the fact that the control of the proposed Nabucco Pipeline from Syria by Putin would make up for his ongoing apparent natural gas designs gone awry.]

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Putin's grand scheme of strong-arming Ukraine, Poland, and others and making Europe ever more dependent on Russian gas has not only failed but seriously endangers the gas monopoly's very existence. Well-known experts such as Mikhail Korchemkin, head of East European Gas Analysis, believe that Gazprom has only a few years before bankruptcy. With Russia's future oil exports looking soft the Russian Academy of Sciences' Energy Research Institute in early April forecast that oil exports could drop by 20 percent over the next 30 years weakness in gas exports will deliver a double-whammy to Putin's power base. The financial flop of the Soviet gas pipeline in the 1980s contributed significantly to the eventual collapse of the evil empire a few years later; the prospective collapse of Putin's energy strategy may similarly hasten the demise of his evil empire lite. (READ ENTIRETY - Pipeline Politics; Is Putin Running Out of Gas? By Alex Alexiev & Steven F. Hayward; Downstream Today – Originally Weekly Standard; 5/27/13)

America’s quest to bomb Syria is not about chemical weapons being used against the Syrians. Chemical weapons are basically a smoke screen, and Obama desperately wants to remove Assad from power for other reasons.

The players in this continuing world drama are Turkey, the United States, Iraq, Saudi Arabia, Iran and Russia. There is a good reason why Turkey and Saudi Arabia both have their backs against the wall and are desperate to take out Assad.

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Two years ago, Syria announced it found a promising gas field in its country, and Oil Minister Sufian Allawai said “The first wells were drilled at Qara in Homs governorate, and the flow rate is 400,000 cubic meters per day.” This is great news for Syria’s energy revenues. Besides the prospect of its own gas field, Syria is also one of the most strategic locations for natural gas pipelines to flow to Europe.

Qatar, home to the world’s largest gas field along with Iran, has proposed a gas pipeline from the Gulf to Turkey that would traverse Syria to the Mediterranean, with the gas then being shipped to Europe. Assad in 2009 refused to go along with the Qatar plan, instead inking deals with Russia and Iran.

Called the Islamic pipeline, it is set to open in 2016; in fact, Iran, Iraq and Syria signed deals in 2011 to construct the 3,480 mile natural gas pipeline that runs from Iran’s South Pars to Europe. This Iran-Iraq-Syria pipeline is set to be the largest gas pipeline in the Middle East. It will snake through Iran, Iraq, Syria, South Lebanon and through the Mediterranean; in addition, the best refinery and infrastructure is in Damascus. Further talks between Iran, Syria, and Iraq for construction of the Islamic Pipeline kicked off in Baghdad today.

The Islamic pipeline through Syria could cut energy power of Qatar and Turkey. To make matters worse, most Arabs view the Islamic Pipeline as a Shi’ite pipeline serving Shi’ite interests. After all, it originates in Shi’ite Iran, passes through Shi’ite Iraq, and flows into Shi’ite controlled Syria. Therefore, the Sunni-dominated Gulf nations have both an economic and to a lesser extent, a religious reason, for stopping the Islamic Pipeline from becoming a reality. So far, the Gulf nations have violently opposed Syria’s adoption of the Islamic Pipeline by arming opposition fighters within Syria in order to destabilize the nation.

This is certainly one reason why President Obama helped run weapons from Benghazi, Libya, through Turkey into the hands of the Syrian rebels. Al Qaeda strongly opposes the Assad government and has joined other rebel factions in an effort to overthrow Assad and to install a more Sunni-friendly government.

Russia has built up naval presence in the ports of Latakia and Tartus to protect the pipeline.

Saudi Arabia is desperate to get rid of Assad. The Saudi’s, through their intelligence … (READ ENTIRETY -It's not about the chemical weapons, it's about the Syrian pipeline By Vicky Nissen; Examiner; 9/9/13)

And the US Political Elites on both sides of the Isle are Involved, see here look at the board members:

Major shareholders of Genie Energy – which also has interests in shale gas in the United States and shale oil in Israel – include Rupert Murdoch and Lord Jacob Rothschild. This from a 2010 Genie Energy press release:

Claude Pupkin, CEO of Genie Oil and Gas, commented, “Genie’s success will ultimately depend, in part, on access to the expertise of the oil and gas industry and to the financial markets.

Jacob Rothschild and Rupert Murdoch are extremely well regarded by and connected to leaders in these sectors. Their guidance and participation will prove invaluable.”

[Blog Editor: The above link is to a video that has interesting information but will make an offer to deal with the info. Video title below]

Could Take Effect as Early as October 17

“When it happens, 16 states are ready to disappear from the United States, including California and Florida.” Wall Street Journal

__________________________

Warren Buffet, Bank of America and all the Big Banks

Sent: 9/20/2013 7:42 AM

Warren Buffet and Bank of America as well as all the Big Banks have this helping them profit.... It’s the greatest group of insiders ever in the history of the world!!!!! This will take you right to page 144 and show you the insider information …….

Here is how they are controlling inflation…. and it shows how the insider's club is not helping the debt investment market that feeds a consumer supply-side demand. So this means the market is overpriced.

The Federal Reserve Is Paying Banks NOT To Lend 1.8 Trillion Dollars To The American People

Did you know that U.S. banks have more than 1.8 trillion dollars parked at the Federal Reserve and that the Fed is actually paying them not to lend that money to us? We were always told that the goal of quantitative easing was to "help the economy", but the truth is that the vast majority of the money that the Fed has created through quantitative easing has not even gotten into the system. Instead, most of it is sitting at the Fed slowly earning interest for the bankers. Back in October 2008, just as the last financial crisis was starting, Federal Reserve Chairman Ben Bernanke announced that the Federal Reserve would start paying interest on the reserves that banks keep at the Fed. This caused an absolute explosion in the size of these reserves. Back in 2008, U.S. banks had less than 2 billion dollars of excess reserves parked at the Fed. Today, they have more than 1.8 trillion. In less than five years, the pile of excess reserves has gotten nearly 1,000 times larger. This is utter insanity, and it will have very serious consequences down the road.

This explains why all of the crazy money printing that the Fed has been doing has not caused tremendous inflation yet. Most of the money has not even gotten into the economy. The Fed has been paying banks not to lend it out.

But now that big pile of money is sitting out there, and at some point it is going to come pouring in to the U.S. economy. When that happens, we could very well see an absolutely massive tsunami of inflation.

Posted below is a chart that shows the growth of the M2 money supply over the past several decades. It has been fairly steady, but imagine what would happen if you … (READ THE REST -The Federal Reserve Is Paying Banks NOT To Lend 1.8 Trillion Dollars To The American People; By Michael Snyder; The Economic Collapse; 7/1/13)

NEW YORK (Reuters) - Months of anticipation will come to an end next week when the Federal Reserve finally says whether it will start to rein in its massive stimulus of the economy, which has flooded financial markets with some $2.75 trillion over the past five years, supercharging returns on everything from stocks to junk bonds.

But for all the concerns that the reduced presence of such a giant asset buyer would be calamitous for investors, it appears equity and bond markets are poised to take next week's Fed decision largely in stride - provided the central bank doesn't surprise with the size of its move or shock in some other way.

Obamacare is a Result of this Trend because they have not the will to try and continue to allow the free market economic concept to feed demand because of Peak Earth Ideology!!!!!!

This 15 year chart shows why the Governments around the world are setting up the free market consumer driven international economy to become a Big Government rationed economic system.

The rate of this inflation is an unsustainable signal that demand is out pacing any kind of supply-side growth potential in the key areas of resource production and development that sustains life growing at the rate it has been.

This is why we see a dysfunctional Government not willing to up hold the values of the Constitution in their entirety.

This is a 15 Year chart of key resource price inflation and interest rates

1998 2013 % Change

Dow Jones Industrial Ave. 7,908 14,840 4.29%/year

Federal Funds Rate 5.50% -.25% -100%

Prime Rate 8.5% 3.25% -62%

10-Year Treasury Bills 5.54% 2.73% -49%

Gold (lb.) $290 $1,470 +11.43%/year

Copper (lb.) 66¢ $3.23 +11.17%/year

Oil (barrel) $8.74 $101 +17.72%/year

Lean Hogs (cwt.) $38 $96 6.37%/year

Live Cattle (cwt.) $58 $128 5.42%/year

Land (per acre) $1,801 $8,296 10.72%/year

Corn (bu.) $1.99 $7.27 9.02%/year

Soybeans (bu.) $5.85 $15.36 6.65%/year

Wheat (bu.) $3.17 $7.52 5.93%/year

This will end in nation Isolating from the International free market Scheme because as these supply demand struggles increase without any future growth expanding the supply and population continuing to expand incomes in the free market will not be able to manage the continued inflation in the key vital resource categories and nations will have to respond to their society outcry with intervention in free market profitability.